A pair of classic American brands had opposite days Friday as shares of one logged their best day ever on reports of a possible sale, while the other’s stock struck a record poor performance after a report of a pending bankruptcy.
Earlier Friday, shares of Rite Aid Corp. RAD, -51.04% plummeted after the Wall Street Journal reported the drugstore chain was filing for Chapter 11 bankruptcy protection as it has more than $ 3.3 billion in debt and faced multiple lawsuits alleging its pharmacists overprescribed opioid painkillers, citing people known to be familiar with the plans.
Following the report, Rite Aid shares sunk as low as 66 cents a share, and finished Friday down 51% at just under 71 cents a share, their lowest recorded closing price, according to FactSet data. Previously, the stock’s worst one-day performance was a 39% drop on March 12, 1999, to close at $ 451.25, while Rite Aid’s highest closing price was $ 1,018.75, back on Jan. 8, 1999, according to FactSet.
Rite Aid shares are down 78.9% to date in 2023, compared with a 14.8% gain in the S&P 500 index SPX. Back in June, shares came under pressure amid reports that the company was looking to restructure $ 2.9 billion in debt.
FactSet
Read: Rite Aid’s stock drops more than 50% on report of pending Chapter 11 bankruptcy
Meanwhile Friday, Reuters reported that Hostess Brands Inc. TWNK, +21.73%, known for its Twinkies and Snoballs snack cakes, was contemplating a sale to more than a few interested parties such as General Mills Inc. GIS, +0.53%, Mondelez International Inc. MDLZ, +0.92%, PepsiCo Inc. PEP, +1.26% and Hershey Co. HSY, +1.60%, and being advised by Morgan Stanley. Reuters cited sources close to the matter who wished not to be identified.
Hostess shares surged as much as 30% Friday to an intraday high of $ 28.84 — past the stock’s highest closing price of $ 28.74, set on Nov. 8, 2022 — but closed at $ 27, for a 21.7% gain, topping their previous best one-day gain of 15.4% on March 1, 2018, according to FactSet.
Friday’s rally also pushed Hostess shares into positive territory for the year, with the stock up 20.3% year to date.
FactSet
Read: Hostess’s stock shoots toward best day ever on report of Twinkies maker’s possible sale